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Is Blended Scotch Turning Bourbon? - Comment

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In Glasgow, Scotland's former second city of the British empire, small corners still bear witness to its American colonial past. This is where the Scottish tobacco lords, flush with the wealth of the 18th-century Atlantic trade, built their mansions, leaving behind names such as Virginia Court, Jamaica St and Kingston Bridge.

Pernod Ricards Barrelhound emulates the Bourbon profile

Pernod Ricard's Barrelhound emulates the Bourbon profile

Now, Scotland's whisky lords - only marginally less wealthy but with a comparably keen interest in the US - have set their sights on a more modern American cash crop; one that like the tobacco of old is finding enviable global growth.

Bourbon.

There has been a subtle shift in the characteristics of new Scotch launches in the past few months towards the category's more rugged, edgier - and more in vogue - American cousin.

This month, Diageo unveiled a new premium range for Johnnie Walker that uses different wood finishes for the blended Scotch. The first instalment will be a rye cask finish matured in Bourbon barrels for ten years that "blends the flavour characteristics of Bourbon and rye" into the signature Johnnie Walker flavour.

Edrington's latest in the Famous Grouse range takes similar inspiration from Bourbon. Mellow Gold, unveiled this week, is a "premium" extension described as "subtly sweeter" than the core Grouse range, putting it firmly in the realm of the sweeter-profile Bourbon category.

In May, Pernod Ricard went further with the launch of the US-only Barrelhound, which aims to emulate the Bourbon profile, but from a Scotch perspective.

"In a market dominated by American whiskey, we feel that Barrelhound brings something different and exciting to the category," the company said.

The motivation for these products is plain to see - whereas Bourbon is enjoying growing demand around the world, blended Scotch has run into trouble.

In the US, for example, Johnnie Walker, the world's biggest selling blended Scotch brand, saw sales drop by 14% in the second half of last year. According to Nielsen figures, in the 52 weeks to 19 July last year, Pernod's flagship Chivas Regal was down 4% in sales and 6% in volumes in the US.

Meanwhile, in South Korea, the previously buoyant blended Scotch market has taken a kicking over the past few years as younger consumers turn to vodka, beer and soju. Both Diageo and Pernod have seen volumes of their leading brands fall.

It was Edrington's global brand manager for The Famous Grouse who put his finger on the category’s problem last year. Consumers, Asanka de Silva said, are moving up or down the value chain leaving behind a squeezed middle where many blended Scotches play. His strategy was to move The Famous Grouse upwards, "towards the premium end of the standard market".

Blended Scotch distilleries have been busy innovating to premiumise the product. Now, part of that effort appears to be to manoeuvre into the slipstream of Bourbon and capture some of the growing trend for sweeter, more accessible spirits.

No where is this trend more evident than with Pernod's Barrelhound.

Speaking to just-drinks at the opening of a new distillery last month, Chivas Brothers' CEO, Laurent Lacassagne, despite a long day of interviews, visibly brightened when the product was mentioned, calling it "a nice little project".

Barrelhound is, for now, only available in New York, but, according to Lacassagne, initial reception has been good.

"The idea is to test the appetite, the interest of US consumers," he said. "It is a Scotch whisky that will be much more contemporary, playing a little bit in the territory of the new, edgy and different Bourbon brands, but still a very good Scotch whisky as well."

Lacassagne said Barrelhound is sweeter than other blended Scotches, but achieved solely through the different types of barrels used, allowing it to retain what he called the "quality characteristics" of Scotch.

"What we are seeking is to maybe have a different type of Scotch," he said. "Less serious."

It is this lighter side that Scotch has been searching for. While Bourbon has made hay with flavour extensions such as the successful Jack Daniel's Tennessee Honey and emergent Tennessee Fire, Scotch has been far more confined by the rules and regulations of the industry. While companies have dabbled in flavours - Ballantine's Brasil is one example - no one appears willing to risk diluting Scotch's premium appeal.

Even a blend like William Grant & Sons' Monkey Shoulder, which has not so much flirted with the Bourbon category but stayed the night and cooked breakfast, knows the value of keeping within boundaries.

"It's important for us that our liquid is a serious Scotch," Monkey Shoulder's UK brand manager, James O'Connor, told me.

There is, however, a yearning to leave some of Scotch's past behind. "The only reason that everyone isn’t drinking (Scotch) is there's a lot of baggage that has accumulated around it," O'Connor said.

Better then to innovate by increments. And slowly shed some of that baggage.


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